Don't be without a plan

Marcia Heroux Pounds Commentary

Workers losing their jobs have health insurance options

Andrea Hannegan of Margate lost her job at a medical imaging firm about a month ago. Besides the loss of income, she's now paying $417 a month to continue her health insurance.

COBRA, a federal law that extends insurance for laid-off workers for at least 18 months, is particularly important to Hannegan, 38. She has multiple sclerosis.

"Benefits are a key, more important than pay," says Hannegan who says she has not missed a day of work because of her disease. "I want to work. I'm loyal and dedicated."

Workers who lose their jobs may be tempted to drop insurance coverage, but that could be a mistake. One trip to the hospital can be a huge financial hit. A major injury or illness could be catastrophic to your family's finances.

For laid-off workers, a big question is: What do I do about health insurance? You may have more options than you think.

Join your partner's plan. If you're married or your partner's employer health plan includes domestic partners, ask for coverage under his or her plan. It may be your cheapest option.

Opt for COBRA within 60 days of being let go. You can continue your same health insurance coverage for at least 18 months under the Consolidated Omnibus Budget Reconciliation Act.

For most laid-off workers, "COBRA is the first refuge point," says Patrick Curtin, benefits consultant of Mahoney & Associates in Fort Lauderdale. The downside is workers have "the full burden of the premium. There can be administrative expenses as well."

If you have a terminal illness or are pregnant, you need to stay covered under COBRA. Other pre-existing health conditions may prevent you from obtaining new insurance, but it doesn't hurt to shop around.

If you exhaust benefits under COBRA and have a medical condition, you may be eligible for a guaranteed-issue health policy, meaning coverage must be issued regardless of the applicant's health status. The Health Insurance Portability and Accountability Act provides credit for prior coverage.

If you're relatively healthy, "COBRA is not your only option," says Wendy Nice Barnes, vice president of human resources for eHealthInsurance, a firm that provides an online tool to compare medical insurance costs.

Compare individual health plans, which often cost less than COBRA. Even family coverage may be cheaper. Major plans including Blue Cross Blue Shield, Aetna, Cigna and Humana offer individual plans for short periods.

Check your professional association. Some offer group health insurance coverage for members.

Join AARP. The senior-rights organization has worked with health insurers to cover members 50 to 64 years of age.

"There's no health exam or lab tests, just some questions," says David Mathis, senior vice president for AARP's health products and services.

He gives the example of a 57-year-old male: a comprehensive policy through AARP costs $350 a month. Catastrophic coverage, covering hospital but not professional service or other expenses, with a $1,250 deductible costs $199 a month. A high-deductible plan ($3,000 to $5,000 for an individual) is priced at $283 a month, but provides comprehensive health coverage.

A side benefit for Baby Boomer parents: AARP members can cover their dependents who are full-time students up to age 25.

Become self-employed. Workers who decide to become independent contractors or start their own business could form an S corporation and supply their own health insurance.

August is the only month each year when self-employed Florida workers have open enrollment for health insurance plans on a guaranteed basis. Single-group employers, sole proprietors, independent contractors and others may obtain health insurance or switch plans.

Cover your kids. Florida's KidCare program provides health insurance coverage for children up to 18 years old. The premium depends on income, ranging from $15 a month per child to $159 a month per child. Laid-off workers who are collecting unemployment income can apply for the program. Check floridakidcare.org for information.

Marcia Heroux Pounds can be reached at mpounds@sun-sentinel.com or 561-243-6650.

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